Intellectual Property after Brexit - The Big picture, Brexit Models and state of Eurocracy

BREXIT AND INTELLECTUAL PROPERTY

RIGHTSThe big picture, how Brexit can be

enacted and how it will affect IP

Teemu Alexander PuutioLL.B., LL.M., Ph.D., B.Sc. Econ.

10 November 2016

The big pictureBrexit and trade with the EU

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• The EU is the second largest economy in the world at USD 16.51 trillion (GDP)

• UK is fifth at USD 2.6 trillion (GDP)• EU represents 51% of exports (£13 billion) and

48% of imports (£21.9 billion) in September 2016

• Caveat: the Rotterdam effect

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The big picture

• 78.4% of the UK economy comes from providing services

• Between March 2016 and April 2016, the estimated total surplus on trade in services was £7.2 billion

• Financial services being the largest contributor with a surplus of £10.5 billion

• Particularly relevant IPs: Trademarks

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Trade in services

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• After Brexit, the EU would continue to be the world’s second largest market

• It would also remain as the UK’s biggest trading partner.

• Further, more then three million EU citizens live in the UK, and two million UK citizens live in the EU

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Conclusion: the EU is not going anywhere

The Brexit modelsThe different ways in which Brexit

could happen and what it means for IP

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• Continuing from John:• “May hopes for a sui generis ‘close

relationship’ with the EU after Brexit which does not fit into any current model which means that all remaining EU countries will have a say in negotiating and veto right over any final agreement that is reached.“

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The sui generis relationship

• One of the most often discussed options is for the UK to ‘do a Norway’ i.e. to join the European Free Trade Association and the European Economic Area

• Would minimize Brexit related costs and represents a ‘soft Brexit’– Full access to single market– UK would be exempt from EU rules on agriculture, fisheries, justice and home affairs

• However, would also entail: – obligatory financial contributions – many EU Directives are relevant to the EEA and could continue to influence UK law

free movement of people and capital • Implications for IP

– UK courts would still need to interpret intellectual property law in light of EU rules– EU-wide devices such as the Community Trade Mark would no longer apply to the

UK

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Going Norwegian

• UK could also go the way of Switzerland, i.e. to join EFTA and remain outside of the EEA

• Access to single market for goods would be acquired through the negotiation of bilateral deals with the EU

• Represents a harder Brexit:– Financial contributions would remain obligatory– UK would face regulation without representation a– Under Swiss model, there would be no blanket agreement with the

EU on free trade in services which drives the UK economy• Implications for IP

– Similar to Norway model, with more freedom to negotiate bilaterally

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Making a Swiss deal

• Absent any particular deals with the EU, the UK would default to WTO rules

• Trade with EU would continue, but now with tariffs– Tariffs would be set according to “most favoured nation”

terms• Traded goods would still need to adhere to EU

standards• Implications for IP:

– No exhaustion rules– Border measures would be up to negotiation by the UK

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The default WTO model

• Return to 1846 policies – opening up for free trade unilaterally• Singapore and Hong Kong apply a similar model with success• Meaning is obscure:

– Tariffs only, and a binding commitment to keep at 0?– For services and IP non-tariff-barriers matter more

• Further critique: – unilateral free trade would not be economically superior to EU

membership– would be less simple than imagined – and would also be politically unacceptable.

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Singapore and Hong Kong approach

PracticalitiesSome implications and

considerations when making Brexit decisions

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• UK IP laws are predominantly constructed around European Directives or derive from European Regulations

• Transitional legislation is needed for types of IP– EU Trademarks and Registered Community Designs– Geographical Indications

• Enforcement is another area of concern:• Post Brexit, the UK will no longer have the benefit of the Brussels Recast

Regulation which enables enforcement and reciprocity of judgments in EU – UK courts will not be able to take jurisdiction over infringement of foreign

intellectual property rights nor could it grant cross-border injunctive relief– No automatic recognition of judgments in courts of other Member States

• However, the UK may seek to join the Lugano Convention which provides for similar mechanisms

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Avoiding the vacuum and ensuring comity

• European Medicines Agency– Currently hosted in London, with EEA could continue?

• Supplementary protection certificates – Term of pharmaceutical SPCs to be reviewed

• Regulatory data protection (RDP) – Protection from first applicaiton in EEA or UK?

• Parallel imports and exhaustion of rights– A more advantageous regime for rights holders?

• European Digital Single Market– Copyright reform, roaming charges etc.

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Particular issues that the Government will need to consider

• Negatives:– Economies of scale as we scale through different

models of engagement with EU– Uncertainty leading to pressure and making

untested decisions • Positives:– Policy independence enabling regulatory innovation– Faster reactions and reforms– Bi-lateral mobility

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The general issues affecting the decision

The diplomatic aspectThe state of eurocratic diplomacy and copycat

brexiteers

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Rise of anti-UK sentim

ent

‘We are seeing the beginning of a spiteful, dirty tricks campaign

designed to make life difficult for the British in Brussels, simply

because we voted to leave the EU,’ said Roger Helmer, a Ukip MEP.

• A larger anti-EU, anti-establishment movement and burgeoning nationalism sentinent is on the rise across EU

• Brexit copycats in Finland, Greece and France• Scottish refefrendum #2?

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Sympathy for the devil: Fixit, Grexit and Frexit

Thank [email protected]

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